Govt mum on fate of drivers in 457 review

Government isn't saying if new report into the skilled migrant program will reconsider dumping truck drivers

By Troy Bilsborough and Jason Whittaker

The Federal Government isn’t saying if a new report into the skilled migrant program will force a rethink on dumping truck drivers from the list of eligible occupations.

But it is likely employers will have to hike salaries for foreign workers in other transport-related positions under recommendations from a report into so-called visa subclass 457 workers.

The Government excluded freight truck drivers from the program earlier this year, but left drivers of other types of vehicles, including garbage trucks and forklifts, as eligible occupations under the scheme.

The trucking industry attacked the decision as short-sighted, insisting labour shortages are still crippling some businesses.

A spokesperson for Immigration Minister Senator Chris Evans tells ATN the Government will consider the new report on the scheme by industrial relations expert Barbara Deegan, but couldn’t say whether it is reviewing the list of eligible occupations.

The Australian Trucking Association says the 457 visa issue is on the agenda for its next General Council meeting next week.

Deegan’s report argues skilled migrant workers employed under the visa program should be paid market rates, while employers should also have to pay a levy to cover Medicare and insurance costs for workers.

The minimum salary level currently available to employers sponsoring international workers on long-stay visas would be banished in favour of wages inline with the industry average under the recommendations.

Currently the minimum salary level is $43,440 for all industries except ICT, which sits higher at $59,477.

The change would apply to employees on salaries less than $100,000.

According to the Government’s latest summary report of 457 activity, mining was the only industry where the national average nominated base salary reached six figures.

Transporters, meanwhile, are only paying an average nominated base salary of $74,500, according to the report, suggesting salaries could rise substantially if the plan is implemented.

Victoria was the only state where exemptions might apply, with the average nominated base wage $109,600.

Evans says paying market rates would ensure workers brought in under the scheme were not used to "undermine" the wages and conditions of Australian workers.

Unions agree, saying it would reduce the incentive to use temporary migrants as "a cheap labour source".

"Unions have always been sceptical about whether the 457 visa program has been used to fill genuine gaps in the workforce, or simply to provide a cheap source of labour to employers," ACTU President Sharan Burrow says.

Both the AMWU and the CFMEU want businesses to be forced to pay a premium for the services of 457 visa holders.

They say it would serve to ensure employers first seek out local labour.

But with companies already bearing the costs and risks associated with transporting, housing and training 457 workers, as well as ensuring their health and well-being, business groups say paying market rates would go along way to reducing the incentive altogether.

Unions are calling for employees to meet these costs on top of the premiums.

Master Builders Australia CEO Wilhelm Harnisch argues the subsequent price increases resulting from any spike in labour costs would undoubtedly work against the Government’s attempts to curtail inflation.

According to the Australian Industry Group the fundamentals of the recommendation are flawed to begin with, arguing any attempts to set local market rates would be "hugely complicated" and "difficult to enforce".

Even Deegan – who made the recommendation for market rates – acknowledges the great difficulties such a model would pose.

"While paying market rates would suggest both a fair and desirable outcome (particularly in that all workers doing a particular job at a particular location would be paid comparable wages), the concept of regulating payment of market rates (as opposed to allowing the market to determine the rate at which that person is paid) is not simple," she said in the review.

Master Builders suggest a better indicator of the "appropriate value" of employees would be for a requirement to pay the minimum award rate.

This approach would by bolstered by a safety net for workers, which is currently being built into awards during the Australian Industrial Relations Commission’s modernisation process.

The Motor Trades Association of Australia also recommends utilising relevant industrial instruments as an alternative to paying market rates.

The report has been referred to the Skilled Migration Consultative Panel, which comprises representatives from business and industry groups, state governments and unions.

Evans says the recommendations and the resulting views of the Consultative Panel will guide the Government’s reform of the 457 program as part of the 2009 Budget.

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